For probably the most sought-after founders, the prestige of a top-tier accelerator is increasingly weighed against giving up a major ownership stake of their company.
Ali Partovi, the veteran investor and CEO of enterprise firm Neo, desires to offer the mentorship and community of one of the crucial elite accelerator programs—without forcing the most effective up-and-coming tech leaders at hand over 7% and even 10% of their company before they’ve even began.
Partovi, who is understood for his early investments in Facebook, Cursor, and Kalshi, has just introduced Neo Residency, a brand new, competitively structured program that mixes the firm’s now four-year-old accelerator with a track for current college students.
The terms that Neo Residency offers are so founder-friendly as to be “not even comparable to some other accelerator,” Partovi told TechCrunch.
For the cohort of 12 to fifteen startups entering this system this summer, Neo will invest $750,000 via an uncapped SAFE — a contract that provides an investor future equity in exchange for money now, with no ceiling on the valuation used to calculate that stake. Unlike the fixed-percentage deals typical of other accelerators, Neo won’t receive its equity until the corporate’s next formal funding round, and even then, the dilution is tied to valuation. If a startup raises its next round at a $15 million valuation, Neo’s stake might be 5%, but when that valuation hits $100 million, the firm’s ownership drops to only 0.75%.
“We take the chance up front, so this is incredibly favorable to startups,” Partovi said.
As compared, Y Combinator typically takes a set 7% of the corporate for $125,000, with one other $375,000 invested on an uncapped MFN — or most-favored nation — SAFE, a clause that ensures early investors get terms no less than nearly as good as those given to later ones. Meanwhile, Andreessen Horowitz’s Speedrun program typically invests $500,000 in exchange for 10% of the startup’ via a SAFE note, and one other $500,000 if the following round is raised inside 18 months at whatever terms are agreed to by the opposite investors.
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“We’re offering a deal so great that it’s appropriate even for founders who usually are not even considering some other accelerator,” Partovi said.
The lower equity cost is simply a part of Neo Residency’s appeal.
The founders will work for 3 months at Neo’s offices in San Francisco’s Jackson Square district, take part in a two-week bootcamp within the Oregon mountains, and be mentored by about 30 experienced operators, including Russell Kaplan, president of Cognition, and Fuzzy Khosrowshahi, CTO of Notion (and the creator of Google Sheets and in addition Partovi’s uncle).
But this system’s foremost draw is its prestige: Seed and Series A investors generally have great respect for founders handpicked by Partovi.
“The one [accelerator] I like straight away that has very high signal, and each founder I met there may be just wicked smart, is Neo,” Wesley Chan, co-founder and managing partner of FPV Ventures, said on stage at 2025 TechCrunch Disrupt.
Startups which have undergone this system include Moment, a fintech company that has raised $56 million from investors like Andreessen Horowitz, and Anterior, a healthcare AI startup backed by NEA and Sequoia.
The Neo Residency will even select five to eight students—either as individuals or small teams—who will receive a $40,000, no-strings-attached grant to take a semester off to work on a project. While there is no such thing as a requirement to drop out or start a proper company immediately, Partovi said he hopes the scholars will catch the entrepreneurial bug and, once they eventually launch a startup, turn to Neo for funding.
Neo is keeping this system small and elite: it’ll cap its two annual cohorts at 20 teams each, consisting of a mixture of energetic startups and student projects.
Why is Neo offering such generous terms? “We’ve more confidence in our ability to draw and select future superstars than ever before,” Partovi said.
His track record suggests that confidence is well-founded. He famously met Cursor co-founder Michael Truell while Truell was still an MIT student and later wrote one among the primary checks into the AI coding startup, now valued at nearly $30 billion.